Regulator for care homes proposed

Care homes could be regulated to prevent a repeat of the Southern Cross crisis.

Care and Support Minister Norman Lamb will launch a consultation exercise into proposed measures which would protect residents if care providers fail.

Under the proposals, a regulator would monitor the financial health of the largest providers.

The abrupt collapse of Southern Cross, Britain's biggest care homes operator, caused turmoil for more than 30,000 elderly and vulnerable people last year.

The firm was crippled by having to pay a £250 million rent bill as councils sought to cut fees in the wake of the first credit crunch.

Mr Lamb said: "We want to make sure every person receiving care and support will continue to get the care they need if a provider exits the market, regardless of whether they are paid for by the state, or pay for care themselves.

"Southern Cross demonstrated that we need greater oversight of providers' finances and better plans to support people if their independent provider goes out of business.

"We want to make sure care providers have plans in place to get their finances back on track and if this is not possible then a co-ordinated exit from the market happens. This will mean care service users know their needs will continue to be met."